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HMRC internal manual

Capital Gains Manual

Private residence relief: introduction: scheme of relief

TCGA92/S222, TCGA92/S223, TCGA92/S224, TCGA92/S225, TCGA92/S226

Private residence relief is given by TCGA92/S222 to TCGA92/S226. The purpose of the relief is to enable a person to replace their existing home with another home of similar value by ensuring that the proceeds of sale of the old home are not diminished by a charge to Capital Gains Tax. So in most cases the gain arising on the disposal of a person’s home is relieved from Capital Gains Tax.

Private residence relief is available where a gain arises from the disposal of an interest in


  • a dwelling house, or
  • part of a dwelling house

which has at some time been its owners only or main residence, by TCGA92/S222 (1)(a), see CG64230+ or


the garden or grounds of that residence up to the permitted area, by TCGA92/S222 (1)(b), see CG64350+.

A residence which is outside the United Kingdom may qualify for relief if the conditions in this guidance are met.

The garden or grounds includes the buildings standing on that land, see TCGA92/S288. So a building which is not part of the dwelling house can still qualify for relief if it is within the permitted area of garden or grounds.